Poseidon Nickel's Proposed Sale of Lake Johnston to Mineral Resources Limited

Poseidon Nickel Limited (ASX: $POS) has entered into a Binding Heads of Agreement to divest Lake Johnston to Mineral Resources Limited, subject to certain conditions precedent. The proposed sale includes a $1 million non-refundable cash payment upon execution of the agreement, with a further $14 million in cash to follow, and royalties on lithium minerals and other minerals extracted from the tenements. The $15 million from the sale will provide Poseidon with funding to execute the Company's strategy, including exploration focus, reduced care and maintenance activities at Black Swan, and pursuing new opportunities.

Executive Commentary on Proposed Sale

The CEO, Craig Jones, stated, 'The proposed transaction will crystallise value for shareholders through the monetisation of one of our assets and will enable the Company to continue with its strategy to progress the exciting exploration targets identified at Windarra, maintain Black Swan as our near-term production asset, and progress new opportunities that are complementary to our portfolio. The proposed divestment will also reduce our annual expenditure commitments by approximately $1.4 million and remove the rehabilitation provisions for that project from our balance sheet. Combined with significant cost reduction initiatives implemented over the past six months, the reset cost base along with $15 million cash consideration from the proposed sale of Lake Johnston strengthens the Company's balance sheet and provides sufficient funding for ongoing working capital requirements to successfully execute the Company's current strategy.'

Summary of Proposed Sale and Outlook

Poseidon Nickel Limited (ASX: $POS) has entered into a Binding Heads of Agreement to divest Lake Johnston to Mineral Resources Limited, providing the company with $15 million in cash and royalties from future minerals or metals production. The proposed sale will reduce annual expenditure commitments, remove rehabilitation provisions for Lake Johnston from the balance sheet, and strengthen the company's balance sheet. This funding will support Poseidon's strategy, including exploration focus, reduced care and maintenance activities at Black Swan, and pursuing new opportunities. The company aims to continue progressing exploration targets, maintain Black Swan as a near-term production asset, and explore complementary opportunities. The proposed sale aligns with Poseidon's goal of being a profitable and sustainable nickel producer, focusing on resource growth and modern exploration techniques.